Liar Loans Reborn

michaels

Surely income from the govt is safer than from any company. And if it is cheaper to pay a mortgage rather than housing benefit to a landlord then why not?

Thrugelmir

Let's hope it's profitable for them.

TrickyTree83

That's a bizarre form of capitalism.

Do nothing, get a house for free.

Can't agree with that I'm afraid, the mortgage ought to be in the governments name and the house becomes social housing thereafter.

Edit: Should have read the article further, it's a "payday loan" type lender and self-cert mortgage lender. Apologies for my over-reaction.

cells

michaels wrote: »

And if it is cheaper to pay a mortgage rather than housing benefit to a landlord then why not?

in a lot of the country it would be cheaper to buy a house off the market and give it away for free than it would be to keep people in social housing let alone private rental

If you take social rent as £500 per month and 30 year gilts at 1.55% (yes 1.55% I checked twice I couldn't believe my eyes) the government can buy a house outright for £140,000 and give it away to a council tenant for free and that would be cheaper than putting the tenant into a council property. And of course at the end of the 30 years the tenant owns a house outright which is an asset for them and their kids rather than staying in the council property which after 30 years still needs the £500 per month subsidy

I dont know what to make of this.
Either interest rates are broken badly (to the benefit of the state)
Or the social rental sector is very inefficient and charges rents far higher than it could/should
Or we have reached a new economic model where capital is cheap and thus housing is very cheap (in ~80% of the country) with the mortgage market as the problem for why more households are renting (not prices not mortgage rates)

cells

michaels wrote: »

Surely income from the govt is safer than from any company. And if it is cheaper to pay a mortgage rather than housing benefit to a landlord then why not?

To add further to this. It seems like it might be a good idea. Maybe the government should buy something like half a million homes off rightmove outside the SE by issuing £60 billion of 30 year gilts at 1.5% coupon.

It should then gift these homes to social tenants in London and the SE for free who can move out of the capital and the SE and get a home and an asset to pass to their kids.

It might sound silly and some people will cry foul but it would address so many problems. You could move potentially 250,000 social households out of London and 250,000 social households out of the SE and into rUK.

This would re-balance the population
It would re-balance the price differential of London/SE vs rUK
It would re-balance the rent differential of London/SE vs rUK
It would help greatly reduce public transport congestion
It would help create lots of jobs outside the SE (aprox 500,000 created outside the SE if this happened)
It would solve most of the 'housing crisis' in London and the SE
It would convert 500,000 social households into owners
It would give those 500,000 ex-social households an asset to pass to their kids
It would reduce the social housing benefits bill by £3 billion (+annual inflation) while the interest on the issued debt would cost a fixed £0.9B a year. The difference of £2.1B + increasing annually would be a huge benefit which could be used to cut taxes

The vacated 500,000 social homes should be sold (up until the local area is 10% social) and they would raise something like £100 billion. You could use that to pay off the original £60B or invest it in other infrastructure


There should be a limit on sale. No sales of this gifted house unless selling and buying an equivalent at the same time. No borrowing against it. On death it can be passed to the children or whoever is in the will and then be a fully free property to do as anyone wishes with.

CLAPTON

cells wrote: »

To add further to this. It seems like it might be a good idea. Maybe the government should buy something like half a million homes off rightmove outside the SE by issuing £60 billion of 30 year gilts at 1.5% coupon.

It should then gift these homes to social tenants in London and the SE for free who can move out of the capital and the SE and get a home and an asset to pass to their kids.

It might sound silly and some people will cry foul but it would address so many problems. You could move potentially 250,000 social households out of London and 250,000 social households out of the SE and into rUK.

This would re-balance the population
It would re-balance the price differential of London/SE vs rUK
It would re-balance the rent differential of London/SE vs rUK
It would help greatly reduce public transport congestion
It would help create lots of jobs outside the SE (aprox 500,000 created outside the SE if this happened)
It would solve most of the 'housing crisis' in London and the SE
It would convert 500,000 social households into owners
It would give those 500,000 ex-social households an asset to pass to their kids
It would reduce the social housing benefits bill by £3 billion (+annual inflation) while the interest on the issued debt would cost a fixed £0.9B a year. The difference of £2.1B + increasing annually would be a huge benefit which could be used to cut taxes

The vacated 500,000 social homes should be sold (up until the local area is 10% social) and they would raise something like £100 billion. You could use that to pay off the original £60B or invest it in other infrastructure


There should be a limit on sale. No sales of this gifted house unless selling and buying an equivalent at the same time. No borrowing against it. On death it can be passed to the children or whoever is in the will and then be a fully free property to do as anyone wishes with.

and it would create another 500,000 social tenants
and then another 500,000 social tenants
and ...................

cells

CLAPTON wrote: »

and it would create another 500,000 social tenants
and then another 500,000 social tenants
and ...................

the vacated social homes would be sold

Also thinking about it a bit more I think instead of what I posted the UK government could just buy Mortgage backed securities. Have the banks write 100% repayment mortgages at 2% fixed for 30 years upto a sum of £150,000. Offer them to social tenants in London and the SE if they buy outside of London/SE. No further debt on property or sale unless sale and purchase at the same time.

The employed now ex social tenants can pay the upto £555 per month repayment mortgage themselves (just like they would have been paying their social rents themselves). The unemployed now ex social tenants can get the upto £555 per month paid on their mortgage for them.

DiggerUK

One thing is clear, money is cheap as chips. If it had any value then the interest it could charge would reflect that.
Truth is, the pound in your pocket really has been devalued.

The comments about homes for unemployed are thought provoking. Would only be of any social benefit if new homes were built, any status of home would be welcome in my book..._